Baby Boomer Expenses Increasing

Out-of-pocket healthcare costs for baby boomers expected to double by 2040.
The CBS (3/5, Fried) MoneyWatch blog reports, "The Retirement Policy program at the UI [Urban Institute] ran some computer models to see how healthcare costs not covered by Medicare might shake out circa 2040, assuming income growth, healthcare spending, and insurance coverage stay on the same pace as today." The researchers found that "in constant (inflation-adjusted) dollars...out-of-pocket costs will double from about $3,300 a year today to $7,800 per person in 2040, putting a greater burden on retiree incomes." Notably, "in the two lowest income quintiles, 70 percent of retirees will have out-of-pocket costs that exceed 20 percent of their income," and "among the two highest-income quintiles, the percentage spending more than one-fifth of their income on healthcare costs is estimated to rise from a combined seven percent today, to 31 percent in 2040."